Michail, check out PRD. (Polaroid's problem) ART
Updated: 11-Jul-01
Last Update: 08:16 ET
Trading Points
Comprehensive coverage on Short Stories, analysis on Story Stocks
08:16 ET Openwave (OPWV) 24.14: -- Update -- Morgan Stanley downgrades to NEUTRAL from Strong Buy
based on what firm regards as the absence of near-term catalysts until visibility into 2.5G improves and because shares
look fully valued based on firm's revised estimates (FY02 cut to $0.23 from $0.65). Thinks OPWV may experience
slowdown in business due to just-in-time ordering, new initiative delays, a potential slowing in wireless Internet adds
and slipping 2.5G rollouts... OPWV shares trading down 23% in pre-market.
08:15 ET Opening Indications : Activity has been mixed thus far but generally quiet with the S&P futures currently
trading 3.5 pts below fair value while the Nasdaq 100 is now 1 pt above fair value. Market reaction minimal to the
Compaq warning.
08:09 ET Scios (SCIO) 21.29: Company receives FDA "approvable letter" for its congestive heart failure treatment
Natrecor.
08:06 ET CIENA Corp (CIEN) 29.32: Thomas Weisel Partners downgrades to BUY from Strong Buy and cuts
price target to $45 from $85; cites change in market psychology and more conservative outlook for FY02, reduces
FY02 revenue estimate to $2.30 bln from $2.84 bln and EPS to $0.99 from $1.20.
08:06 ET Pericom Semi (PSEM) 13.50: Company sees Q2 earnings of $0.02 on revenues of approx. $13.3 mln;
consensus estimate for the qtr was $0.06. PSEM saw improvements in turns business and total bookings over the prior
qtr, but not enough to meet original goals.
08:04 ET Internet Infrastructure : In addition to the telecom downgrades, Goldman Sachs also cuts ratings on the
internet infrastructure group, citing finite window of opportunity for these companies and prohibitively high risks: EQIX
to MARKET PERFORM from Recommended List, EXDS and LDCL to MARKET OUTPERFORM from Market
Perform.
08:03 ET Openwave (OPWV) 24.14: Issue plunges 15% in pre-market; hearing talk that a tier-1 firm is downgrading
the stock this morning.
08:00 ET Emerging Telecoms : -- Update -- In addition to WCOM and the Recommended List downgrades
mentioned before, these telecom stocks were downgraded to MARKET PERFORM from Market Outperform by
Goldman: ALSK, ARCC, FCOM, NTKK, and WCG. The rationale for the downgrades was to bring individual
company ratings in line with Goldman's Underweight rating for the group. Also notable are a few telecom stocks which
Goldman left on its Recommended List and spoke positively about: GX, Q, T, SBC, ALGX, AWE, NXTL, and BCE.
07:53 ET WorldCom (WCOM) 14.24: Though CNBC just reported that WCOM was not among the Goldman
Sachs downgrades of telecom carriers this morning, we have confirmed with Goldman that WCOM was downgraded
to MARKET OUTPERFORM from Recommended List, and cut its price target to $16 from $18.
07:51 ET Zions Bancorp (ZION) 56.80: Lehman initiates coverage with a STRONG BUY rating and $72 target
price. Views stock as one of the most attractive investment opportunities in the mid-cap bank universe.
07:47 ET Emerging Telecoms : Goldman Sachs removes a host of emerging telecom stocks from its Recommended
List; lowered from Rec. List to Mkt Perform were MFNX, LVLT, ITCD, NPLS, MCLD, XOXO.
07:40 ET Pacific Sunwear (PSUN) 19.41: Retailer reports a 7.4% decline in June same-store sales. Company
expects to achieve EPS at the lower end of the $0.13-$0.17 range (consensus $0.14).
07:36 ET Barr Labs (BRL) 64.70: Pharmaceuticals company raises Q4 outlook to a range of $0.49-$0.51 from
current First Call consensus of $0.43; cites higher than expected sales from non-Tamoxifen products and better than
expected mix of sales of higher margin products.
07:34 ET Salomon 10+ List : Salomon Smith Barney releases 10+ List: ABT, ALTR, ADI, AOL, EDS, F, FRE,
JNY, LNC, PFE, TYC, WMT, WMI, WFC, WY.
07:30 ET Infineon Tech (IFX) 20.36: Merrill Lynch (Europe) raises near-term rating to BUY from Neutral and sets
a target of $27. Firm making a valuation call on Infineon's shares based on very weak relative performance compared
to the sector. Thinks secondary offering, if completed, will clear the short term share overhang and help rebuild
company's balance sheet.
07:24 ET Opening Indications : This morning's fair value figures -- S&P 500 fair value:1187; closed 1 pt below fair
value. Nasdaq 100 fair value: 1637; closed 1 pt above fair value. Current indications: S&P 500 futures are -0.50,
or 1.5 pts below fair value. Nasdaq 100 is +3.0, or 4 pts above fair value... Compaq (CPQ) bid up slightly in
pre-market despite earnings warning, lending support to hardware sector. Entering trading today, investors more
concerned about further technical erosion in major indices (Nasdaq, DJIA, SOX) than earnings warnings.
07:17 ET Dell Computer (DELL) 25.61: UBS Warburg reduces Q2 est. to $0.14 from $0.16 on indications that
DELL may be getting more aggressive on pricing. Firm concerned that DELL may push industry pricing levels
lower, responding to actions by competitors, lowering everyone's operating profitability. Warburg thinks DELL's
fundamentals and valuation could be under further significant pressure. "No winners in this price war."
07:06 ET EchoStar (DISH) 27.80: Company increases its stake in StarBand to 32%, which will increase to 60%
upon commencement of the construction of StarBand's next generation satellite.
06:53 ET Polaroid (PRD) 2.70: WSJ reports that company is discussing a debt-restructuring plan with its bankers
and is giving serious consideration to a voluntary bankruptcy filing. The immediate issue for PRD is a loan covenant set
to expire tomorrow. Failure to receive an extension would mean that its banks could call several hundred million dollars
in outstanding loans.
06:47 ET Emerson Electric (EMR) 61.41: Company warns of an 11% decline in EPS for Q3 and a mid-single-digit
decline in full yr EPS. According to First Call estimates, EMR had been expected to grow EPS 1.1% and 2.7% for the
qtr and full yr; cites weakness in its electronics and telecom ops for shortfalls.
06:39 ET Comverse Tech (CMVT) 39.02: Company cutting estimates for Q3 and Q4; sees earnings of $0.20 and
$0.23 for the periods vs current consensus of $0.44 for Q3 and $0.45 for Q4. Revenues for the qtrs are projected at
$330 and $340 mln vs Multex consensus estimates of $369 and $387 mln, respectively.
06:32 ET Protein Design (PDLI) 63.19: Company announces it has entered into a 2-yr patent rights agreement with
American Home Products (AHP). Under the agreement, AHP will pay an upfront fee to PDL for rights to obtain a
worldwide, non-exclusive license under PDL's antibody humanization patents for antibodies to a specific target antigen.
06:27 ET U.S. Markets : S&P futures trading at 1186.20, 0.8 points below fair value, Nasdaq 100 futures trading at
1643, 6.0 points over fair value. The 30-year bond is down 3 ticks at 5.676%. The dollar is under pressure against
both the yen and the euro.
06:26 ET European Markets : FTSE -0.89%, DAX -1.05% -- European stocks under heavy pressure. Markets
down for the seventh consecutive session. Technology underperforming on the back of yesterday’s warning from
Compaq, which specifically noted weakness in Europe. European banking shares under pressure as well, as Merrill
Lynch cut its earnings forecast for a number of stocks, while Deutsche Bank cut recommendations on HSBC, ABN
Amro and Credit Lyonnis. Chipmakers such as Philipps Electronics have also been hit by a warning from Japan’s
Advantest. Oil and chemical shares have seen better selling, though some interest has been reported in the autos
following JP Morgan’s decision to upgrade DaimlerChrysler.
06:25 ET Asian Markets : Nikkei -2.40%, Hang Seng -1.46% -- Asian stocks closed sharply lower. Not
surprisingly, technology suffered in the wake of yesterday’s 3% decline in the Nasdaq. Yesterday’s warning from
Compaq weighed heavily on computer-related companies. Blue-chip names such as Toshiba, Sony, Advantest, Hitachi
and Tokyo Electron all helped to drag the Nikkei lower, while even defensive shares saw better selling. The Nikkei
closed just 185 points shy of a 16-year low, while Taiwan fell to its lowest level since August of 1995. Foreign selling
weighed on Korean shares, which also fell under the weight of the third lowest close for the year in Samsung
Electronics. Singapore closed lower for the seventh time in eight sessions, while Hong Kong dipped to its lowest level
since April 10, with China Mobile underperforming. |
